REAL PROPERTY INTERESTS

WHAT ARE FREEHOLD ESTATES?

Freehold estates are possessory interests in land of indefinite duration. The duration of a freehold estate may, however, be limited by a condition. If there are no conditions that limit the duration, then the property interest is in fee simple absolute. If the property interest can be cut short by the occurrence or non-occurrence of an event or other condition, the interest is one of the defeasible fee simple estates. If the property interest terminates upon someone’s death, it is called a life estate.

What Interests Can I Have If The Estate Is Not Limited By Any Condition?

Fee Simple Absolute– An interest in fee simple absolute is a fee simple estate, and has no conditions attached to it that could possibly cause its termination. In other words, it is the maximum possible ownership interest known under this country’s system of laws. It is an estate that is possibly infinite in duration.

WHAT INTERESTS CAN I HAVE IF THE ESTATE IS LIMITED BY A CONDITION?

Fee Simple Determinable– An interest in fee simple determinable is a fee simple estate that terminates automatically by the occurrence of a special limitation. These limitations use durational language like: “until,” for so long as,” or “while.” Upon the occurrence of the special limitation the ownership interest automatically reverts to the transferor.

Fee Simple Subject to Condition Subsequent– An estate in fee simple subject to a condition subsequent is similar to a fee simple determinable in that it can be terminated upon the occurrence of an event or condition. These limitations use conditional language like: “provided that,” “but if,” or “on condition that.” Unlike a fee simple determinable, this fee simple interest does not terminate automatically. Instead, the transferor must take some overt action to retake ownership of the property.

Fee Simple Subject to Executory Limitation– An estate in fee simple subject to executory limitation is very similar to the two defeasible fee simple interests discussed above. However, unlike the others, a third party holds the future interest. Upon the occurrence of the terminating condition the possessory interest automatically transfers to the third party.

What Interests Can I have If The Estate Is Measured By A Life?

Life Estate– A life estate is also a freehold estate. The duration of a life estate can be measured by the life of the grantee, or by the life of another person. A life estate is automatically terminated upon the death of the measuring party, regardless of whether that person is currently in possession of the property.

WHAT ARE CONCURRENT ESTATES?

A concurrent estate exists if more than one person shares an interest in property at the same time. Concurrent owners are referred to as cotenants. All concurrent estates require a unity of possession, meaning that all cotenants are entitled to use, control, and possess the property.

What are The Forms Of Concurrent Ownership?Tenancy in Common– Tenancy in Common is the most frequent form of a concurrent estate, and is the default estate for unmarried cotenants. This concurrent estate only requires unity of possession, meaning all tenants are entitled to possession or control of the property. A person does not need to be in actual possession of the property to be a cotenant. The other unities discussed below are not necessary to create a tenancy in common.

Joint Tenancy– A Joint Tenancy is a concurrent estate that requires four unities: possession, interest, time, and title. This means that the joint tenants’ must have an equal right of control or possession of the property, have an equal interest in the property, and must all receive their interests at the same time and in the same instrument. In addition to the four unities, a joint tenancy also must include a right of survivorship.

Tenancy by the Entireties– A Tenancy by the Entireties, much like a Joint Tenancy, requires the four unities of possession, interest, time, and title. Tenancy by the Entireties also requires the unity of marriage; this means that the cotenants must also be husband and wife. Tenancy by the Entireties is the default concurrent estate for property jointly owned by a married couple; however married couples may also have the concurrent interests discussed above.

WHAT ARE LEASEHOLD ESTATES?

Leasehold estates are of fixed duration. The lessee, commonly referred to as tenant, receives possession of the property for a fixed period of time according to the terms of his agreement. However, ownership of the property remains with the lessor, commonly referred to as landlord.

I Have An Oral Lease. What Type Of Leasehold Do I Have?

Tenancy at Will– In Florida, any lease entered into orally results in a tenancy at will.[i]The duration of a tenancy at will is determined by the period in which payments are made; if payments are due every week then the duration is week to week, if payments are due monthly then the duration is month to month, etc.[ii]A tenancy at will can also be created by written agreement if its duration is determined by the payment periods.[iii]

My Lease Is In Writing. What Type Of Lease Do I Have?

Periodic Tenancy– A periodic tenancy automatically continues for successive periods unless a party gives notice to terminate the agreement.[iv]

Tenancy for Years– A tenancy for years has a known duration at the time of creation.[v] The duration can be for any amount of time (days, weeks, months, or years).[vi]A tenancy for years terminates upon the expiration of the lease term.[vii]

Tenancy at Will – A tenancy at will (discussed above) can also be created by written agreement if its duration is determined by the payment periods.[iii]

WHAT HAPPENS IF I OUTSTAY THE TERM OF THE AGREEMENT?

Tenancy at Sufferance– A tenancy at sufferance occurs when a person who was in lawful possession of property remains after the lease expires.[viii] Continued payment does not renew the lease, but if the landlord provides written consent then the tenancy becomes a tenancy at will.[ix]

WHAT ARE FUTURE INTERESTS?

If an interest in real property can be cut short by a condition, another person will have what is known as a future interest in the estate. This means that on the occurrence of the limiting condition, another person will receive a possessory interest in the property. This can occur automatically, but, depending on the type of estate may also require an overt act by the person who owns the future interest.

Are There Any Future Interests In A Fee Simple Absolute Estate?

Because an estate in fee simple absolute cannot be cut short by any sort of condition, there is no future interest attached to an estate in fee simple absolute.

Are There Any Future Interests In A Fee Simple Determinable Estate?

Because there is a chance that an estate in fee simple determinable will be cut short by the occurrence of this special limitation, the transferor retains a future interest in the property called apossibility of reverter. A transferor in possession of a possibility of reverter does not need to exercise a power of termination; the prior estate is terminated automatically upon the occurrence of the special limitation.

Are There Any Future Interests In A Fee Simple Subject To Condition Subsequent Estate?

Because there is a chance that an estate in fee simple subject to condition subsequent will be cut short by the occurrence of this limitation, the transferor retains a future interest in the property called aright of entryor aright of termination. A transferor must exercise his or her right of entry (or termination) in order to regain possession of the property.

Are There Any Future Interests In A Fee Simple Subject To Ececutory Limitation?

Because there is a chance that an estate in Fee Simple Subject to Executory Limitation will be cut short by the occurrence of this limitation, the transferor retains a future interest in the property called anexecutory interest. A third party who has an executory interest does not need to exercise a power of termination; the prior estate is terminated automatically upon the occurrence of the terminating condition.

Are There Any Future Interest In A Life Estate?

There are two future interests that can follow a life estate. If upon the death of the measuring life, the possession of the propertyreverts back to the grantorthen the future interest is called areversion. Alternatively, if upon the death of the measuring life, the possession of the property transfers to aperson other than the grantor, then the future interest is called aremainder.

WHAT IS A RIGHT OF SURVIVORSHIP?

If an interest in real property is owned as Joint Tenants or as Tenants by the Entireties, then there is a right of survivorship. This means that if one of the tenants dies his or her property will be distributed to the other tenants. If a joint tenant dies, the deceased tenant’s interest is distributed equally among the surviving joint tenants. If a spouse dies, the surviving spouse will receive the deceased spouse’s interest.

How Do I Know If My Contenancy Includes A Right Of Suvivorship?

A right of survivorship is present only if the express language of the conveying instrument includes a right of survivorship.[i]“’Section 689.15, Fla. Stat., F.S.A., abolishes the right of survivorship in real and personal property held by joint tenants except in cases of estates by the entireties or in tenancies in common where the instrument creating the estate shall expressly provide for the right of survivorship.’”[ii]This means that the right of survivorship must be created by express language on the conveying instrument.[iii]

Must All The Unities Be Present In Order To Include A Right Of Suvivorship?

No, the right of survivorship can be included despite a missing unity.[iv]The real issue is not whether all unities are present but instead whether the grantor intends on including a right of survivorship.[v]If an instrument expressly provides for a right of survivorship, then it is irrelevant that one of the unities is lacking.[vi]Thus, if the express language of the instrument includes a right of survivorship, it is unnecessary to consider the other unities.[vii]

The Property Was Conveyed To My Spouse And Me. Is There A Right Of Suvivorship?

Survivorship language is unnecessary to create a right of survivorship between spouses, because by default property conveyed to a married couple, is conveyed as tenants by the entireties.[viii]“’A conveyance to spouses as husband and wife creates an estate by the entirety in the absence of express language showing a contrary intent.’”[ix]Thus, including survivorship language in a deed transferring property to a married couple would be redundant.[x]

What Happens To A Tenancy By The Entireties Upon Divorce?

A Tenancy by the Entireties becomes a tenancy in common upon divorce.[xi]

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